Democrats hunt for support for auto bailout

Published 7:00 pm, Wednesday, November 12, 2008

By JULIE HIRSCHFELD DAVIS

Associated Press

WASHINGTON -- Senate Democrats pressed ahead on Thursday with plans to vote next week on a $25 billion emergency loan plan for U.S. carmakers as the auto industry and business groups readied a lobbying onslaught to overcome GOP opposition.

Senior Democrats are drafting legislation that would carve out part of the $700 billion Wall Street bailout for loans to the three major U.S. auto companies in exchange for a government ownership stake in the companies.

They hope to push the measure through during a postelection session of Congress that begins Monday. General Motors Corp., Ford Motor Co. and Chrysler LLC are lobbying feverishly for Congress to approve the aid, citing an economic downturn that has choked off sales and frozen credit.

But the idea is running into resistance from Republicans and President George W. Bush, who are reluctant to back any additional money for the struggling industry. House GOP leader John Boehner of Ohio issued a statement Thursday promising to oppose any new auto industry loans.

"Spending billions of additional federal tax dollars with no promises to reform the root causes crippling automakers' competitiveness around the world is neither fair to taxpayers nor sound fiscal policy," Boehner said.

Senate Republican leader Mitch McConnell of Kentucky -- home to a General Motors and two Ford plants -- has been noncommittal about new aid. His office says Congress should instead speed release of $25 billion in loans approved by Congress last month to help automakers develop more fuel-efficient vehicles.

House Speaker Nancy Pelosi, D-Calif., has yet to schedule a legislative session to consider the new loans as Democrats keep hunting for the votes to pass it.

"Right now, I don't think there are the votes," said Sen. Chris Dodd, D-Conn., chairman of the Senate Banking, Housing and Urban Affairs Committee. While supporting the proposal, Dodd cautioned against "bringing up a proposition that might fail." He suggested that Congress wait until President-elect Barack Obama is sworn in on Jan. 20 to provide further help to the carmakers.

Senate Majority Leader Harry Reid, D-Nev., rejected that idea. His office said he would press forward with a still-unwritten measure next week.

"While we continue to work out the best way forward, we expect the Senate to consider legislation during next week's lame-duck session," said Reid's spokesman, Jim Manley. "But we cannot do it without the support of Senate Republicans."

With feelings still raw from the election and the public outraged about the Wall Street rescue, the auto proposal remains a tough sell. Some Senate Republicans have expressed skepticism that the aid would lead to changes for the companies that could make them viable in the long run.

Still, supporters of the auto bailout hope they can snag 12 to 15 Republicans to join with Democrats in pushing it through.